Olympics in Brazil

On August 5th, 2016, Rio de Janeiro will open its arms to athletes, spectators, and leaders from across the globe for the 31st Summer Olympics in what many are already calling the most important day in the city’s history. With a total estimated budget of $12.5 billion, which has been quietly raised over the past year and is expected to be exceeded, the games are a major investment for a nation descending into recession after years as the golden child of development. Like many other developing nations, who host the Olympics, Brazil, and specifically Rio, hope that their endeavor will be the turning point towards economic reinvention. Ever since the success of the 1992 Summer Games for Barcelona, countries like China, Russia, and now Brazil see the Olympics as not only a chance to prove their mettle, but also potentially very rewarding kick start. Should the games be a resounding success, several politicians will certainly feel the boost, not least of which Eduardo Paes, Mayor of Rio de Janeiro. Much more popular than President Dilma Rousseff, Paes has been the encouraging voice of reason in the run up to the games, which many say conveniently places him for re-election in late 2016 and even for a sturdy presidential bid in 2018. The 2016 Olympics could the perfect tonic for Brazil’s struggles of the past five years, yet high risks come with the prospects of high rewards.

In the run-up to the games, the international narrative has been overwhelmingly negative. This has mostly been driven by skeptics in the International Olympic Committee (IOC), as well as the increasingly loud voices of displeased Brazilian citizens. Brazil’s economy as a whole has stuttered to a halt in the past five years, with the currency falling 60% and economists from its own Central Bank predicting the economy to contract in 2015 after a national deficit of between eight and nine percent. Much of the economic downturn has been chalked up to President Dilma Rousseff’s administration, particularly sticky as she has been a champion of the Olympics as Brazil’s great chance at rejuvenation.

When the 2016 Olympics were awarded to Rio de Janeiro in 2009, Brazil was enjoying robust growth and many in Rio celebrated the successful bid. Those same residents were the same protesters out on the streets just a few years later, when in the midst of a recession, public money was whisked away to begin renovating sports venues and constructing the Olympic Village. This residential complex, located in the Barra da Tijuaca neighborhood, forced hundreds of local families to abandon their homes with meager compensation. In addition, most of the promised development benefits of the games have been invested in this small, rather prosperous area of Rio, far from its infamous favelas. Barra da Tijuaca is home to only 300,000 of Rio’s 6 million residents, which points to a quite small proportion of the population set to benefit from the games in the short term.

Things did not improve when an official delegation from the IOC visited Rio in 2014 to inspect development progress, and declared that preparations were the “worst ever seen.” Protests were renewed as the public took the visit as proof that not only was money being diverted from domestic growth and poverty reduction, but that it was doing little good where it was sent. While the 2014 FIFA World Cup, hosted in cities across Brazil, ultimately went off successfully, it experienced similar problems with efficiency and cost. The Olympics hosted just two years later is seen by Brazil’s urban poor as an extension of a painful saga of spending. Half-finished stadiums were blamed on construction firms later revealed to be connected to the Petrobras scandal, in which the national energy corporation grafted roughly $2.1 billion from public coffers. Athletes from the world over have raised strong concerns about levels of pollution on Rio’s beaches and in its Guanabara Bay, which is set to be the location of all sailing events. After German sailor Erik Heil was diagnosed with MRSA after a test run in the bay, the Associated Press released a report warning that concentrations of dangerous bacteria were an astounding 1.7 million times acceptable levels. Despite being the first ever Olympics hosted in South America, a pall has certainly been thrown over Brazil’s great chance to prove its progress.

A more recent concern, and a growing challenge for the host city, is security during the games. The brutal Paris attacks on November 13th, 2015 raised terror alert levels across the world, and certainly alerted leaders to risks at large public events. The Olympics have been marred by terrorism in the past, most notably with the murder of 11 Israeli nationals at the 1972 Munich Olympics, and Brazil knows it cannot afford to take chances. The number of security agents present in Rio is quoted to be double that of the London games, and many are already calling for more strict regulation on visas given to Olympics tourists. Rousseff is already provoking the ire of the games’ security commission, after passing a controversial bill allowing a 90-day visa waiver for all Olympic attendees.

In light of the setbacks and resistance the Brazil has faced, progress has picked up during 2015 and the ballooning budget has slowed its growth. Compared to past games, Rio is over budget but by a much smaller proportion. Since the disastrous IOC visit last year, Mayor Paes has cautioned the need for restraint, saying that this is a chance to disprove the impression that everything in Brazil must be over-budget and late. In a vote of confidence, Standard and Poor’s recently raised Rio’s credit rating just as Brazil’s is balancing on collapse, an unusual move for the agency that points to real progress. The city of Rio de Janeiro itself has taken the lead in planning the Olympics, another hopeful sign amidst Brazil’s larger domestic issues. The lasting legacy of the games, while still very unsure, promises a vastly improved public transportation system as well as several schools set to be built out of the dismantled parts of the Olympic handball arena. No matter the rewards, there are sure to be thousands of Brazilians unhappy with the vast amount of money spent on what has been a long and messy process. Yet, less than one year from the opening ceremony, there are hopes that the balance between risk and reward may not be as unbalanced as initially feared.